France will grant a loan of 200 million euros to Tunisia, which is going through a deep economic crisis aggravated by the war in Ukraine, President Emmanuel Macron announced on Saturday to his Tunisian counterpart, Kaïs Saïed.
“The President of the Republic reiterated France’s support for Tunisia and the Tunisian people in the face of the challenges facing the country,” according to a press release from the Elysée.
The French head of state also welcomed the “open constructive dialogue between the government and the International Monetary Fund (IMF), hoping that it will lead to a definitive agreement”.
A debt that exceeds 100% of GDP
Since the 2011 revolution, Tunisia has sunk into economic difficulties, aggravated by the Covid-19 pandemic, with sluggish growth and very high unemployment. The invasion of Ukraine by Russia in February accentuated the crisis in a country highly dependent on grain and fuel imports, two sectors where prices are soaring.
Suffocated by a debt exceeding 100% of the Gross Domestic Product (GDP), Tunisia obtained in mid-October an agreement in principle from the IMF for a new loan of some two billion dollars disbursable in tranches starting in December.
In return, the government has committed to reforms, including a gradual lifting of state subsidies for basic products (food and energy) and a restructuring of public enterprises which have a monopoly in many sectors.
Democratic decline since President Saïed’s coup
Emmanuel Macron also discussed with his Tunisian counterpart the political situation in Tunisia, recalling that “fundamental freedoms” were “intrinsic” to the “democratic acquis” in Tunisia at a time when NGOs denounce a democratic decline since the coup. by force of President Saïed in July 2021. Mr. Saïed, who monopolized all the powers, promulgated a voting system considerably reducing the role of the political parties which will participate in the legislative elections of December 17.
“The two Heads of State also discussed the regional situation, particularly in Libya, and the means of strengthening cooperation in the Maghreb and the Mediterranean,” added the Elysée.